1. BUSINESS FUNDAMENTALS Role of the Customer

2. STARTING A BUSINESS Weve already spent time discussing different typesof businesses and the type of people who start them. Another factor that drives the creation of businessis the consumerSpecifically Customer Needs and Wants 3. CUSTOMER NEEDS AND WANTS 4. CONSUMER NEEDS AND WANTS Sometimes a business is started to satisfy consumer needs. Needs are things that are necessary for survival. You need food, clothing.BBI 2O UNIT 1Slid e4 5. CONSUMER NEEDS AND WANTS Wants are things that are not necessary for survival, but add comfort and pleasure to our lives. You want a pizza, or new computer 6. MASLOW'S HIERARCHY OF NEEDS MOTIVATIONAL THEORY Why do consumers make the purchases they do? 7. MASLOW'S HIERARCHY OF NEEDS Physiological NeedsThe most basic needs that are vital to survival, such as the need for water, air, food, and sleep Security NeedsThese include needs for safety and security. Examples: steady employment, health insurance, safe neighbourhoods, and shelter from the environment. Social NeedsBelonging, love, acceptance and affection. Example: friendships, romantic companionship, involvement in social, community, or religious groups. 8. MASLOW'S HIERARCHY OF NEEDS Esteem NeedsThe need for things that reflect on self-esteem, personal worth, social recognition, and accomplishment.Self-actualizing NeedsThe need for personal growth without recognition or the opinions of others. Interest in fulfilling ones potential. 9. MASLOWS HIERARCHY EXPLAINED Maslow and Disneys Up http://youtu.be/Iucf76E-R2sMaslow and the Consumer http://youtu.be/wEY1hHpIN1I 10. MASLOWS HIERARCHY AND CONSUMERS Consumers fit into one level of the pyramid The level you are at determines and influences yourconsumer habits Businesses need to recognize these needs and usethem to identify their target market. Which stage is the consumer trying to achieve? Better able to advertise to satisfy those needs. Create products to satisfy needs. 11. MASLOWS HIERARCHY WHERE ARE YOU? Lets take a quick test to see where you fit on Maslowshierarchy. Dont worry you wont need to share your results. Go to Blackboard and click on the link Take the quiz Think about these questions when your done? Do you think it is accurate? How do you think this influences what you want/need? How do you think this influences your consumer habits? 12. BUSINESS AND THE CONSUMER 13. BUSINESSES RELY ON CONSUMERS Many aspects of business depend on the role of theconsumer Supply and Demand Pricing Marketing Production Service 14. ATTRACTING CONSUMER INTEREST It is important to understand how consumers make buying decisions. This will help decide what to make, how to market and distribute the product. Businesses need to listen to what the consumer wants or what they think they need. The challenge is then to get those customers to buy your product. 15. CUSTOMERS VERSUS CONSUMERS Customers buy products or services Consumers use the product or service It is a very small difference and often these termsare used interchangeably. 16. FACTORS THAT INFLUENCE BUYING 17. FACTORS THAT INFLUENCE BUYING INCOME The amount of money consumers have to spend has a big influence on what they buy. Example: 4 Member Families Spending on Groceries 18. FACTORS THAT INFLUENCE BUYING PRICE Price is the most important consideration for consumers Consumers want good value for their money and wontspend more than what they believe an item is worth What other factors do you look for in your purchase? Quality Convenience Service Variety Warranty 19. FACTORS THAT INFLUENCE BUYING STATUS Some people buy goods because neighbours orfriends have Some consumers purchase expensive items evenwhen they cant afford them Conspicuous consumption: the desire to flauntpurchases to impress others 20. FACTORS THAT INFLUENCE BUYING CURRENT TRENDS Usually applies to clothing Clothing creates an image is often seen as anindicator of status or popularity Peer Pressure: Being influenced by friends to buysomething you dont really want 21. FACTORS THAT INFLUENCE BUYING CUSTOMS AND HABITS Special occasions and holidays increase consumerspendingPeople may also buy things due to habit: Friday night dinner out Saturday movie night playing lottery smoker vs. non-smoker 22. FACTORS THAT INFLUENCE BUYING SAFETY Product safety has become a major issue to thepublic especially for cars, appliances, and childrens items (cribs) The Canadian Standards Association (CSA)develops the standards for safety and certifies products 23. FACTORS THAT INFLUENCE BUYING PROMOTION Advertising and promotion are designed toinfluence consumer spending Lifestyle advertising: showing attractive, healthy,successful and appealing people using the product or service that is being promoted. It is suggested that if you use the product your lifestyle will improve. 24. FINAL THOUGHTS ATTRACTING CONSUMERS In Business and Marketing the task is to come up with aproduct the consumer needs or wants, at a price theyre willing to pay, in a place that is convenient, and promote it so they know about it. Maslows Hierarchy of Needs helps businesses identify theirtarget market and understand peoples buying motivation. Income, Price, Status, Trends, Safety, Promotion, Customs andHabits are the most common factors that influence buying.